European funds reach EUR20tn net assets for the first time ever 

AUM

Assets held in UCITS and AIFs have surpassed EUR20 trillion for the first time ever, according to the latest data from European Fund and Asset Management Association (EFAMA).

Net assets increased by 0.8 per cent to EUR20.04 trillion in May, driven by strong sales of equity and multi-asset funds in the month.

The record amount of money invested Europe’s fund management industry has been explained by a positive market environment.

Thomas Tilley, senior economist at EFAMA, pointed to “solid net sales and the strong performance of global stock markets in recent months”.

EFAMA compiled data from 29 national associations across Europe, including the United Kingdom, which together represent 98 per cent of total UCITS and AIF assets in Europe.

Equity UCITS funds have led the way with the fastest-growing net assets, which have risen by 15.6 per cent to EUR5.4 trillion in the year-to-date. 

Investors have added EUR240 billion to equity funds in the year so far, including EUR29 billion in the month of May alone. 

In 2021, equities have benefitted from economic activity restarting in developed markets and a positive risk environment, with the broad equity index MSCI World notching up returns of 13 per cent for the year to 30 June. 

Investors have also started to re-invest in multi-asset funds, with inflows rising to EUR17.3 billion in May, reversing low investment over the previous year. Net assets held in these funds have increased by 7.1 per cent to EUR2.2 trillion in the year-to-date. 

AlFs, which include hedge funds, private equity funds, venture capital and real estate funds, registered net inflows of EUR8 billion, compared to net outflows of EUR1 billion in April 2021.

Bond funds, which account for more than a quarter of all UCITS funds in Europe, have seen slower growth of 2.2 per cent in the year-to-date. 

Inflows to bonds have fallen as inflation has soared and central banks have discussed tightening monetary and fiscal conditions.

Bond UCITs saw net inflows of EUR15 billion in May, down from EUR20 billion in the previous month.

Meanwhile, money market funds continued to face steady outflows of EUR8 billion in May, bringing investor redemptions up to EUR73 billion so far in 2021. 

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Madeleine Taylor
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